Q: what are your observations on NFI refinance actions?
5i Research Answer:
The refinancing was announced a few weeks ago, but is closing today. The extension of maturities is good for the company, and buys it time. The equity issue is somewhat dilutive but of course improves the overall financial picture. The company also got more covenants from its lenders to avoid breaching certain financial ratios. Certainly, these are positive developments, giving the company time to fufill its backlog of orders (which is large now). Overall, positive, but also serves to highlight how highly leveraged and extended the company had in fact become.